Obesity and diabetes are leading causes of morbidity and death in the United States. Recently a nuclear hormone receptor, PPARgamma, has emerged as a critical regulator of both adipocyte differentiation and glucose metabolism, and hence a potential link between obesity and diabetes. PPARgamma is induced during adipocyte differentiation, and specific PPARgamma ligands such as the exciting new class of anti-diabetic drugs called thiazolidinediones (TZDs) not only promote adipogenesis but also enhance insulin action. PPARgamma activity is regulated allosterically by lipid soluble ligand activators as well as by MAP kinase-dependent phosphorylation which reduces PPARgamma activity by an unknown mechanism. This allows crosstalk between extracellular and intracellular signals, converging on PPARgamma. A major goal of this laboratory is to understand the relationships between regulation of PPARgamma activity, adipogenesis, and insulin resistance. We hypothesize that phosphorylation of PPARgamma contributes to cell-specific of PPARgamma activity by altering interactions with different ligands and transcriptional co- regulators. This hypothesis will be directly tested in Specific Aim 1, which is to understand the role of the N-terminus in ligand- dependent transcription by PPARgamma. Preliminary evidence indicates that phosphorylation of PPARgamma A/B domain results in reduced potency but not reduced efficacy of TZDs by lowering the ligand binding affinity of PPARgamma. This will be further evaluated by studying the effects of phosphorylation on the affinities of different ligands, and recruitment of co-activators and co-repressors. We also hypothesize the regulation of PPARgamma activity by phosphorylation plays a physiological role in maintenance of fuel metabolism. This hypothesis will be directly tested in Specific Aim 2, which is to determine the physiological and pathophysiological implications of PPARgamma phosphorylation. Here, the physiology of transgenic animals expressing PPARgamma mutants in adipose tissue will be evaluated in basal and stressed conditions, to determine the effects of dysregulation on homeostatic mechanisms regulating body weight and blood glucose levels. Finally, in Specific Aim 3, we will determine the mechanisms by which TZDs act on PPARgamma to promote insulin action in peripheral tissues. This is a major roadblock in the understanding of the role of PPARgamma activation in diabetes treatment. Given the abundance of PPARgamma in adipocytes, we hypothesize that PPARgamma ligands act on fat cells to alter expression of genes which signal muscle to respond more effectively to insulin. These signals could act directly or indirectly, and the effect of PPARgamma could be to increase or decrease their expression. We will isolate and characterize genes whose expression is regulated by PPARgamma ligands, especially TZD anti-diabetic drugs, and characterize their identity, regulation, and potential role in the mechanism of TZD action. Together, the proposed studies will address the major questions about PPARgamma and its role in body weight and glucose metabolism, which have profound implications for our society where diabetes and obesity are rampant.